President Donald Trump's administration plans to continue permitting some oil and gas development on federal lands but will curtail work on offshore wind during a partial government shutdown that shows no sign of ending soon.
Funding needed to run much of the government ran out at 12:01am ET on Wednesday, triggering the first shutdown in more than six years. Federal agencies will now begin suspending services and furlough an estimated 750,000 workers, according to the US Congressional Budget Office. The divergent treatment of energy permitting aligns with Trump's remarks on Tuesday that he plans to use the shutdown to target "Democrat things" his administration already "didn't want", with the potential to also pursue mass firings of federal workers.
Federal agencies have some ability to continue operations, either by tapping other funding sources or by "excepting" activities they deem necessary to protect human life or property. The US Energy Information Administration said on Wednesday it will be able to operate normally "for a period of time", whereas other federal statistics agencies expect to curtail most operations. The US Environmental Protection Agency (EPA) went ahead with a public hearing on Wednesday for its proposal to repeal nearly all greenhouse gas reporting. EPA said holding the hearing was allowed under its shutdown plans, as it blamed Democrats for the shutdown.
"If they want to reopen the government, they can choose to do so at any time," EPA said.
The US Interior Department released shutdown plans for the agencies it oversees hours before funding lapsed. The updated plan for the US Bureau of Land Management cites Trump's declaration of a "National Energy Emergency" as part of its basis to except workers responsible for permitting and leasing of onshore oil, natural gas and coal, to the "extent such plans are necessary to protect human life and property". Staff responsible for energy activities that collect fees will also be exempt.
The US Bureau of Ocean Energy Management (BOEM), which is furloughing 72pc of its 473 employees, said it plans to use carryover funds for 105 employees to work on "priority or time-sensitive projects", such as an oil and gas lease sale in the US Gulf of Mexico on 10 December and a new offshore leasing program. BOEM's plan contemplates curtailing work on offshore wind, which the administration has been trying to block.
"BOEM will cease all renewable energy activities but continue limited work on conventional and marine minerals based on available resources," the agency said.
Offshore oil and gas permitting, safety inspection of offshore facilities and review of offshore energy plans will continue at the US Bureau of Safety and Environmental Enforcement, which plans to furlough 34pc of its 560 employees. The offshore safety regulator said it plans to stop non-essential training and non-critical regulation drafting.
Even though the Trump administration plans to continue some oil and gas activity, industry officials say a shutdown will be disruptive. The US Federal Energy Regulatory Commission, which handles permitting of natural gas pipelines and LNG export facilities, plans to furlough all but 4pc of its more than 1,500 staffers. EPA expects to furlough all but 11pc of its 15,000 employees, which could delay work on regulations related to the Renewable Fuel Standard.
"Government shutdowns threaten to stall the development of oil and gas resources on federal land," oil industry group American Exploration & Production Council chief executive Anne Bradbury said on Tuesday.
Republicans and Democrats appear to have made little progress on a funding deal that could reopen the federal government. A Republican-backed bill that would fund the government though 21 November failed to pass in the US Senate on Tuesday night in a 55-45 vote. US senators Angus King (I-Maine), John Fetterman (D-Pennsylvania) and Catherine Cortez Masto (D-Nevada) joined Republicans to support the bill, which needed 60 votes to break a filibuster.
The administration on Wednesday froze $18bn of federal funding for a subway expansion and a tunnel project in New York, targeting priorities of US Senate minority leader Chuck Schumer (D-New York) and US House of Representatives minority leader Hakeem Jeffries (D-New York). White House budget director Russ Vought said the funding hold was based on concerns about "unconstitutional" diversity, equity and inclusion principles.
